TurboTax Maker Linked To Fight Against 'Return-Free' Tax System

Proposals that would simplify the filing process for many Americans are under fire from tax preparation company TurboTax. Here, a 2013 IRS Estimated Tax form.

Damian Dovarganes
/ AP

Proposals to let U.S. taxpayers get a statement from the government that's already filled in with their financial information have been under attack by Intuit, the maker of TurboTax, according to ProPublica. The nonprofit newsroom says several people took a stand against the proposal in a grass-roots campaign that Intuit orchestrated.

The proposed "return-free" system would simplify the filing process by using information the federal government receives from banks and employers. It's used in parts of Europe and in a California pilot program. Critics warn, though, that such a system might ignore tax credits and incorporate errors. And tax preparation companies such as Intuit say it would hurt their business.

The ProPublica article is by Liz Day, who also wrote about the campaign against return-free filing last year. She says she looked into the campaign after noticing "remarkably similar language" being used to weigh in on a "remarkably obscure topic."

"President Ronald Reagan supported it and talked favorably about it in 1985. And President Obama has spoken also favorably about it on the campaign trail in 2007. The idea is that you would get a pre-filled return from the government, using the information they already have, to send a pre-filled return to you that you could either accept or throw away. It's completely voluntary."

The opponents found by ProPublica represent a diverse group, from a mayor and other community leaders to an NAACP official and a rabbi. In each case, they were approached by acquaintances with ties to either a trade group that includes Intuit or to lobbyists.

Here's one of those stories, about a rabbi who wrote an opinion piece attacking the proposal:

"Rabbi Dorff says he was approached by a former student, Emily Pflaster, who sent him details and asked him to write an op-ed alerting the Jewish community to the threat.

"What Pflaster did not tell him is that she works for a PR and lobbying firm with connections to Intuit, the maker of best-selling tax software TurboTax.

Clarifying its editorial stance, ProPublica says its quibble with Intuit isn't necessarily with the firm's fight against changing the U.S. tax system. The site quotes Eric Umansky, who worked with Day on the story:

" 'There's nothing necessarily wrong with the idea' of targeting community leaders and local influencers on a cause — 'grasstopping,' in industry lingo — 'if you are transparent, and giving accurate information, both of which were not the case in multiple instances.' "